The board of directors of Cable Plus authorizes the issue of $7,000,000 of 6%, 2

Question

The board of directors of Cable Plus authorizes the issue of $7,000,000 of 6%, 20 year bonds payable. The semiannual interest dates are May 31 and November 30. The bonds are issued on May 31,2014 at par. Journalize the following transactions: payment of interest on November 30, 2014. The board of directors of Cable Plus authorizes the issue of $7,000,000 of 6%, 20 year bonds payable. The semiannual interest dates are May 31 and November 30. The bonds are issued on May 31,2014 at par. Journalize the following transactions: payment of interest on November 30, 2014.

Explanation / Answer

Journal Entry

Date

Accounts / Explanations

Debit

Credit

Nov. 30, 2014

Interest Expense

$        210,000

Cash

$        210,000

(Being interest on bond paid)

Calculation of interest:

Semiannual Interest = Par value * Interest %* 6/12

($7,000,000*6%*6/12) = $210000

Journal Entry

Date

Accounts / Explanations

Debit

Credit

Nov. 30, 2014

Interest Expense

$        210,000

Cash

$        210,000

(Being interest on bond paid)

Calculation of interest:

Semiannual Interest = Par value * Interest %* 6/12

($7,000,000*6%*6/12) = $210000

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.